14th Jun 2022 12:22
(Alliance News) - Xeros Technology Group PLC's 10-year licence deal was called "game changing", with shares in the firm more than doubling on Tuesday.
The stock was trading at 76.25 pence in London around midday on Tuesday, surging from Monday's closing price of 32.50p. Over the past 12 months, however, the stock remains 68% lower.
The company floated on AIM in 2014 with an IPO price of 123p - meaning it currently trades 38% below this.
The Rotherham, England-based environmental technology firm said it has signed a licensing agreement for XFilter with Hanning Elektro-Werke Gmbh & Co KG. Hanning, headquartered in Oerlinghausen, Germany manufacturers components for the appliance industry.
Xeros said the deal has the "potential to deliver significant revenues from late 2023 onwards".
The 10-year non-exclusive agreement will see Hanning manufacture and sell filters using XFilter technology.
It said: "Hanning is establishing a production line to meet demand from their customers ahead of new legislation in France requiring the fitting of microfibre filters in all domestic washing machines by 1 January 2025. Similar legislation is in development in the UK. Xeros is already working alongside Hanning on the integration of XFilter within the washing machines of a number of their existing customers."
Xeros will receive a royalty per filter device sold by Hanning.
"The royalty amount is commercially sensitive, but Xeros can confirm that the commercial terms of the agreement are in line with the board's expectations and, as previously communicated, Xeros expects to begin receiving royalty revenues from Hanning in late 2023," it added.
Broker finnCap said the licence win is "game changing" for XFiltra.
"This is Xeros' first entry point to the domestic washing machine market for XFiltra and, with Hanning components incorporated in approximately 8.5 million washing machines annually, a substantial breakthrough," said finnCap.
The potential of the licence is "substantial", it added.
By Paul McGowan; [email protected] and Lucy Heming; [email protected]
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